Home NewsLandlords Here’s what landlords need to know about the UK spring budget 2024

Here’s what landlords need to know about the UK spring budget 2024

UK’s Chancellor of the Exchequer, Jeremy Hunt, recently delivered the Spring Budget, expected to be the last financial statement before the next general election in the country. Termed as a “budget for long-term growth” by the Chancellor, the announcements are considered a mixed bag for landlords in the UK. Here are some key takeaways that will directly affect the earnings of landlords.

UK spring budget 2024

Reduction in Capital Gains Tax

With one in four landlords looking to sell their properties in the UK every year, the reduced Capital Gains Tax (CGT) from 28% to 24% is positive news for investors and homeowners looking to list their properties on the market. Applicable from 6th April, the reduced tax rate will mean profits earned on property sales will be taxed less. However, the reduction will only impact landlords with properties in the upper band, as the CGT levied on properties in the basic tax band is unchanged at 18%.

Scrapping of Multiple Dwellings Relief

Introduced in 2012, Multiple Dwellings Relief (MDR) provided a reduced Stamp Duty Land Tax (SDLT) rate for landlords purchasing multiple properties together. This relief was beneficial to landlords and developers engaged in bulk purchases as the SDLT was calculated on the collective average of all properties rather than each property individually. However, after several policy reviews, the government decided to scrap MDR.

No relief for furnished holiday lets (FHL)

Until this Budget, landlords of furnished holiday lets (FHL) could deduct the entire cost of their mortgage interest payments from their rental income. These landlords were also entitled to capital allowances on furniture, appliances and equipment stipulated for holiday lets and required to pay a lower CGT when selling their property. However, given the pressure on the rental market, the government expects the scrapping of this FHL tax regime to free more units for long-term rentals. Selling an FHL property was liable to only 10% CGT but will now be similar to the standard CGT rate applied across all properties.

No non-dom tax benefits for overseas landlords

Described as a UK resident with an overseas residence or domicile for tax purposes, non-doms earlier only paid tax on the income generated in the UK. However, with the slashing of the non-dom status, individuals with an overseas domicile will be liable to the same taxes as UK citizens. This means that overseas landlords living in the UK for more than four years will be taxed on their income outside the UK.

While the above measures announced in the Spring Budget of 2024 have a direct implication on landlords and property transactions, the government did not make any changes to the Stamp Duty surcharge. Currently, overseas buy-to-let landlords still need to pay an additional 2% SDLT surcharge over and above the 3% stamp duty levied on second property purchases.

For more insights watch our exclusive post budget webinar about the long-term effects of the Spring Budget and performance of the UK property market.


About the Author

Established in 1958, Benham and Reeves is one of London’s oldest, independently owned property lettings and sales agents. With specialism in residential sales, corporate lettings and property management in prime areas of London, the company operates from 21 prominently located branches and 15 international offices.